DTN Closing Grain Comments

General Comments:

Corn was down 7 1/4 cents in the September contract and down 7 1/2 cents in the December. Soybeans were down 16 1/4 cents in the September contract and down 15 3/4 cents in the November. Wheat closed down 2 1/2 cents in the December Chicago contract, down 5 cents in the December Kansas City and down 2 3/4 cents in the December Minneapolis contract.

The September U.S. dollar index is down 0.21 at 94.94. December gold is up $3.60 at $1,203.60 while September silver is down 3 cents and September copper is down $0.0260. The Dow Jones Industrial Average is down 60 points at 25,763. October crude oil is up $2.08 at $67.92. October heating oil is up $0.0472, while October RBOB gasoline is up $0.0530 and October natural gas is down 0.018.

Corn:

December corn closed lower for a fourth consecutive day, ending down 7 1/2 cents at $3.66 3/4. In spite of USDA's estimate for lower ending world corn stocks in 2018-19, there are no immediate concerns to point to in corn as moderate temperatures and adequate moisture are found across most of the Corn Belt. The seven-day forecast show the best rain chances in the northeastern U.S. Corn Belt and light-to-moderate amounts in Kansas and Missouri. The southwestern Corn Belt will see high temperatures in the 90s by Friday, but overall conditions remain favorable for late August. Earlier Wednesday, the U.S. Energy Department said ethanol production was slightly higher last week, at 1.073 million barrels a day, while ethanol inventory increased from 23.0 to 23.3 million barrels. Despite concerns about EPA waivers, ethanol demand continues to be a stable and important source of demand for corn in 2018. Traders will continue to debate this year's corn crop size, but roughly two billion bushels of old-crop carry adding to 14-plus billion bushels of new harvest is enough to keep bearish pressure on corn prices, at least into harvest. For now, the trend in December corn remains sideways. DTN's National Corn Index closed at $3.28 Tuesday, still above its low in 2018 and 31 cents below the September contract. In outside markets, the September U.S. dollar index is down 0.21 after minutes from the Federal Reserve's latest meeting said interest rates were getting close to a neutral level.

Soybeans:

November soybeans closed down 15 3/4 cents at $8.70 1/4 Wednesday as the bearish influence from cooperative August weather outweighed slight hope that the two-day meeting of Chinese and U.S. officials will end Thursday with significant progress. Even though official expectations are low that any positive change will be seen, trade relations with China are important enough that an unexpected change could have a big price impact. On the other hand, if the current tariff stalemate continues, the focus will shift to China and its ability to minimize U.S. soybean purchases through the fall and early winter. In the meantime, the 2018 soybean crop continues to benefit from moderate temperatures and recent rains, keeping USDA's estimate of a record soybean harvest reasonable. Still trading in a potentially volatile market environment, the trend in November soybeans remains sideways. DTN's National Soybean Index closed at $8.02 Tuesday, up from its lowest price in over nine years and priced 84 cents below the November contract.

Wheat:

December Chicago wheat closed down 2 1/2 cents at $5.45 1/4, edging down to a new three-week low on Tuesday. Light-to-moderate showers fell over parts of Kansas and Oklahoma Wednesday with more expected for Kansas on Thursday and then Missouri on Friday. Temperatures are expected to turn hotter Friday and into the weekend, offsetting some of the benefit of recent rains before winter wheat planting gets started next month. December milling wheat in Europe was steady Wednesday, pulling back from this month's earlier four-year high, while traders try to get a handle on this year's lower wheat supply. Currently, all three wheat prices are struggling to trade higher, unable to take out the resistance at last year's high. The trend in Chicago wheat has turned sideways while the other two remain up. DTN's National SRW index closed at $4.99 Tuesday, 28 cents below the September contract and down from its high in 2018. DTN's National HRW index closed at $5.15 Tuesday, also down from its highest price in 2018.

Todd Hultman can be reached at todd.hultman@dtn.com

Follow Todd Hultman on Twitter @ToddHultman1

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